A little-utilised option but one with significant potential in Queensland is the granny flat.

Granny flats are becoming much more common in Australia as homeowners looks for ways to keep loved-ones closer or earn rental income.

Granddad is close to the grandkids without living inside the cacophony of sound that a young family often produces, adult kids are able to keep an eye on ageing parents without being seen as nosy, and not to mention the possibility of an on-site babysitter built in to the property!

If southern trends are any guide, the growing granny flat market in western Sydney will be echoed in Brisbane, and throughout regional Queensland where house blocks are larger.

Currently, according to ABS Census data, around 1500 granny flats a year are occupied in Brisbane LGA.

An answer to housing affordability?

As housing affordability impacts on families, granny flats can provide some answers with plenty of benefits.

Anecdotal evidence confirms that building a granny flat can attract a premium at sale time, particularly if the main house appeals to those buyers with teenage children, or perhaps have frequent out-of-town visitors.

Being able to offer a separate self-contained retreat for the kids or visitors holds enormous appeal for many home owners.

REIQ Ipswich zone chair Darren Boettcher said granny flats were an emerging market in Ipswich and something he was expecting to see a lot more of in the future, especially for investors.

“It has a dual income potential and you don’t have to subdivide your block, which saves money,” he said.

He cited a recently sold property, a two bedroom house that would have sold for $270,000, but with the granny flat addition, it sold for $430,000.

Renting out your granny flat

Income from renting out a granny flat can also be helpful for first-home buyers looking to ease the burden of mortgage payments.

In many areas, Brisbane and Ipswich to name just two, regulations have been relaxed recently to allow granny flats to be rented out to someone not from your family, offering possible investment and rental income opportunities.

If you’re planning to build a granny flat for the sole purpose of renting it out, make sure you research the rents that a granny flat will bring. Also, check whether your council will permit such activities.

Contingency plans

It would also be worth considering some contingency plans.

What happens to the granny flat resident if the marriage in the main house breaks up, triggering the sale of the property? What happens if the breadwinner in the main house gets a job offer interstate and wants to sell the property? It is advisable to visit with a legal professional to draw up a document that outlines contingency plans for all eventualities.

Whether you are building a granny flat for a relative or to rent out, it’s important to understand the regulations and think the process through before committing.

Over to you – would you build a granny flat on your property?

This article was written in conjunction with REIQ.